A Fresh Look at ConocoPhillips’s Valuation Following Aggressive Cost-Cutting Plans and Industry Restructuring

ConocoPhillips is moving forward with a significant plan to cut up to a quarter of its global workforce, responding to persistent weakness in oil and natural gas prices. This step comes as the company navigates industry consolidation and seeks to tighten expenses.

See our latest analysis for ConocoPhillips.

This move comes after a year marked by falling energy prices and industry-wide restructuring. ConocoPhillips is integrating the Marathon Oil acquisition and striking new LNG supply deals, even as other majors like ExxonMobil and Chevron announce similar cost cuts. While recent news has fueled market debate, the company’s 1-year total shareholder return is down 0.14%, showing the impact of softer commodity prices on sentiment despite operational improvements and a positive long-term track record.

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With shares down more than 14% over the past year but still trading at a 24% discount to analyst price targets, the question for investors is clear: is ConocoPhillips offering a bargain, or is the market already factoring in its future growth?

Most Popular Narrative: 19.9% Undervalued

With a fair value estimate of $116.54 against ConocoPhillips’ last closing price near $93, the most widely followed analyst narrative suggests the company remains noticeably cheap. It points to ambitious plans and strong pricing power as major factors in this view.

The company's expanding LNG portfolio and progress on large-scale liquefaction projects (notably in Qatar, Port Arthur, and Willow) are set to capture significant market share from robust global gas demand, especially as natural gas solidifies its role as a "transition fuel." These projects are expected to drive a substantial free cash flow inflection and topline revenue expansion through 2029.

Read the complete narrative.

Want to unravel the story behind this high-conviction target? The narrative hinges on profit margin improvements, cash flow breakthroughs, and a potential future multiple that rivals growth stocks. Find out how these quantitative bets stack up. One surprising detail could change how you see value in ConocoPhillips.

Result: Fair Value of $116.54 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, heavy reliance on large new projects and volatile oil prices could disrupt ConocoPhillips’ growth trajectory and challenge analyst assumptions in the future.

Find out about the key risks to this ConocoPhillips narrative.

Build Your Own ConocoPhillips Narrative

If you see the story differently or want to dig into the numbers yourself, it takes less than three minutes to build your own perspective. So why not Do it your way

A great starting point for your ConocoPhillips research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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